<PAGE>


                           POPULAR NORTH AMERICA, INC.


                   MEDIUM-TERM NOTE ADMINISTRATIVE PROCEDURES
                           (Dated as of June 30, 2004)

         Medium-Term Notes, Series F (collectively, the "Notes") in the
aggregate principal amount of up to $2,500,000,000, less the aggregate initial
public offering price of Securities (as defined in the Prospectus, dated
December 29, 2003, relating to debt securities and preferred stock of the
Company, Popular, Inc. (the "Guarantor") and Popular International Bank, Inc.)
authenticated and delivered upon original issuance other than the Notes prior to
or after the date hereof, are to be offered on a continuous basis by Popular
North America, Inc. (the "Company"), through UBS Securities LLC, Banc of America
Securities LLC, Keefe, Bruyette & Woods, Inc. and Popular Securities, Inc., who,
as agents (each an "Agent"), have agreed to use their reasonable efforts to
solicit offers to purchase the Notes from the Company. The Agents also may
purchase Notes as principals for resale.

         The Notes are being sold pursuant to a Distribution Agreement among the
Company, the Agents and the Guarantor, dated as of June 23, 2004 (the
"Distribution Agreement"). The Notes will be issued pursuant to the Indenture,
dated as of October 1, 1991, as supplemented by the First Supplemental
Indenture, dated as of February 28, 1995, the Second Supplemental Indenture,
dated as of May 8, 1997, and the Third Supplemental Indenture, dated as of
August 5, 1999 (together, the "Indenture"), each between the Company and J.P.
Morgan Trust Company, National Association (successor in interest to Bank One,
N.A.), as Trustee (the "Trustee"). A Registration Statement (the "Registration
Statement," which term shall include any additional registration statements
filed in connection with the Notes as provided in the Distribution Agreement)
with respect to the Notes has been filed with the Securities and Exchange
Commission (the "Commission"). The Prospectus dated December 29, 2003, as
supplemented with respect to the Notes, is herein referred to as the
"Prospectus." The most recent supplement to the Prospectus with respect to the
specific terms of the Notes is herein referred to as the "Pricing Supplement."

         The Notes will either be issued (a) in book-entry form and represented
by one or more fully registered Notes (each, a "Book-Entry Note") delivered to
the Trustee, as agent for The Depository Trust Company ("DTC"), and recorded in
the book-entry system maintained by DTC, or (b) in certificated form (each, a
"Certificated Note") delivered to the purchaser thereof or a person designated
by such purchaser. Owners of beneficial interests in Book-Entry Notes will be
entitled to physical delivery of Certificated Notes equal in principal amount to
their respective beneficial interests only upon certain limited circumstances
described in the Prospectus.

         General procedures relating to the issuance of all Notes are set forth
in Part I hereof. Additionally, Book-Entry Notes will be issued in accordance
with the procedures set forth in Part II hereof and Certificated Notes will be
issued in accordance with the procedures set forth in Part

<PAGE>

III hereof. Capitalized terms used but not otherwise defined herein shall have
the meanings ascribed thereto in the Indenture or the Notes, as the case may be.



                                      -2-
<PAGE>


                   PART I: PROCEDURES OF GENERAL APPLICABILITY

Date of Issuance/
  Authentication:          Each Note will be dated as of the date of its
                           authentication by the Trustee or its duly appointed
                           authenticating agent. Each Note shall also bear an
                           original issue date (the "Original Issue Date"). The
                           Original Issue Date shall remain the same for all
                           Notes subsequently issued upon transfer, exchange or
                           substitution of an original Note regardless of their
                           dates of authentication.

Maturities:                Each Note will mature on a date selected by the
                           purchaser and agreed to by the Company which is not
                           less than nine months from its Original Issue Date;
                           provided, however, that Notes bearing interest at
                           rates determined by reference to selected indices
                           ("Floating Rate Notes") will mature on an Interest
                           Payment Date.

Currencies:                Each Note shall be denominated in one of the
                           currencies or currency units, as specified in the
                           relevant Pricing Supplement, or in such other
                           currency or currency unit as may be agreed from time
                           to time between the Company and the applicable
                           Agent(s) and as specified in the relevant Pricing
                           Supplement, or, if no currency or currency unit is
                           specified therein, in U.S. dollars. Notes denominated
                           in one or more currencies or currency units other
                           than in U.S. dollars are herein referred to as
                           "Multi-Currency Notes." Notes that have the amount of
                           principal payments determined by reference to an
                           index are herein referred to as "Indexed Notes."

Denominations:             The Notes will be issued in denominations of a
                           minimum of $1,000 and integral multiples of $1,000.
                           Any Notes denominated other than in U.S. dollars will
                           be issuable in denominations as set forth in the
                           relevant Multi-Currency Note Prospectus Supplement.
                           For special provisions relating to Multi-Currency
                           Notes or Indexed Notes, see the related
                           Multi-Currency or Indexed Prospectus Note Supplement.

Registration:              Notes will be issued only in fully registered form.

Redemption/Repayment:      The Notes will be subject to repayment at the option
                           of


                                      -3-
<PAGE>


                           the Holders thereof in accordance with the terms of
                           the Notes on their respective Repayment Dates, if
                           any. Repayment Dates, if any, will be fixed at the
                           time of sale and set forth in the applicable Pricing
                           Supplement and in the applicable Note. If no
                           Repayment Dates are indicated with respect to a Note,
                           such Note will not be repayable at the option of the
                           Holder prior to Maturity.

                           The Notes will be subject to redemption by the
                           Company on and after their respective Redemption
                           Commencement Dates, if any. Redemption Commencement
                           Dates, if any, will be fixed at the time of sale and
                           set forth in the applicable Pricing Supplement and in
                           the applicable Note. If no Redemption Commencement
                           Dates are indicated with respect to a Note, such Note
                           will not be redeemable prior to Maturity, except as
                           set forth in the Prospectus in the event that the
                           Guarantor is obligated to pay Additional Amounts in
                           respect of the Notes.

Calculation of Interest:   In the case of Fixed Rate Notes, interest (including
                           payments for partial periods) will be calculated and
                           paid on the basis of a 360-day year of twelve 30-day
                           months. In the case of Floating Rate Notes, interest
                           will be calculated and paid on the basis of the
                           actual number of days in the interest period divided
                           by 360, with the exception of Treasury Rate Notes and
                           CMT Rate Notes, for which interest will be calculated
                           on the basis of the actual number of days in the
                           interest period divided by the actual number of days
                           in the year. If an Interest Payment Date with respect
                           to any Fixed Rate Note falls on a day that is not a
                           Business Day (as hereinafter defined), the payment of
                           interest required to be made on such Interest Payment
                           Date need not be made on such day, but may be made on
                           the next succeeding Business Day with the same force
                           and effect as if made on such Interest Payment Date
                           and no interest shall accrue on such payment for the
                           period from and after such Interest Payment Date. If
                           an Interest Payment Date with respect to any Floating
                           Rate Note would otherwise fall on a day that is not a
                           Business Day, such Interest Payment Date will be the
                           following day that is a Business Day, except that in
                           the case of a LIBOR Note, if such day falls in the
                           next calendar month, such Interest Payment Date will
                           be the


                                      -4-

<PAGE>

                           preceding day that is a Business Day. If the Stated
                           Maturity, or date of earlier redemption or repayment,
                           as the case may be, of a Note is not a Business Day,
                           the payment of principal and interest due on such day
                           shall be made on the next succeeding Business Day and
                           no interest shall accrue on such payment for the
                           period from and after such Stated Maturity, or date
                           of earlier redemption or repayment. For special
                           provisions relating to Multi-Currency Notes or
                           Indexed Notes, see the related Multi-Currency or
                           Indexed Note Prospectus Supplement.

Acceptance and
  Rejection of Offers:     The Company shall have the sole right to accept
                           offers to purchase Notes from the Company and may
                           reject any such offer in whole or in part. Each Agent
                           shall communicate to the Company, orally or in
                           writing, each reasonable offer to purchase Notes from
                           the Company received by it. Each Agent shall have the
                           right, in its discretion reasonably exercised,
                           without notice to the Company, to reject any offer to
                           purchase Notes through it in whole or in part.

Preparation of
  Pricing Supplement:      If any offer to purchase a Note is accepted by the
                           Company, the Company, with the approval of the Agent
                           which presented the order, will prepare a Pricing
                           Supplement reflecting the terms of such Note and file
                           the Pricing Supplement relating to the Notes with the
                           Commission in accordance with Rule 424 under the
                           Securities Act of 1933, as amended. Information to be
                           included in the Pricing Supplement shall include:

                                    1. the name of the Company;

                                    2. the title of the securities, including
                           series designation, if any;

                                    3. the date of the Pricing Supplement and
                           the date of the Prospectus Supplement to which the
                           Pricing Supplement relates;

                                    4. the price to public (but only if (a) the
                           trade is being made on an agency basis and (b) such
                           price to public is other than 100%);

                                      -5-
<PAGE>

                                    5. net proceeds to the Company (but only if
                           (a) the trade is being made on a principal basis and
                           (b) the net proceeds to the Company is other than
                           100%), less what would have been the applicable
                           agency commission;

                                    6. the information with respect to the terms
                           of the Notes set forth below (whether or not the
                           applicable Note is a Book-Entry Note) under
                           "Procedures for Notes Issued in Book-Entry Form --
                           Settlement Procedures", items A.2, A.3, A.4, A.5,
                           A.6, A.7, A.8 and A.9; and

                                    7. any other terms of the Notes not
                           otherwise specified in the Prospectus or Prospectus
                           Supplement, including, without limitation, any other
                           terms required by the Prospectus or Prospectus
                           Supplement.

                           One copy of such filed document will be sent by
                           telecopy or overnight express (for delivery not later
                           than 11:00 A.M. on the Business Day next following
                           the trade date) to the applicable Agent at the
                           following addresses:

                           To UBS Securities LLC:
                           UBS Securities LLC
                           677 Washington Boulevard
                           Stamford, Connecticut 06901
                           Attention: Fixed Income Syndicate
                           Telephone: (203) 719-1088
                           Telecopy: (203) 719-0495

                           To Banc of America Securities LLC:
                           Banc of America Securities LLC
                           9 West 57th Street
                           NY1-301-2M-01
                           New York, New York 10019
                           Attention:  High Grade Debt Capital Markets
                                       Transaction Management
                           Telecopy:   (212) 847-5184

                           To Keefe, Bruyette & Woods, Inc.:
                           Keefe, Bruyette & Woods, Inc.
                           787 Seventh Avenue
                           New York, New York 10019
                           Attention: Fixed Income Syndicate

                                      -6-
<PAGE>

                           Telecopy: (212) 582-5419

                           To Popular Securities, Inc.:
                           Popular Securities, Inc.
                           209 Munoz Rivera Avenue
                           Hato Rey, Puerto Rico  00918
                           Attention:  Ken McGrath
                           Telecopy:    (787) 766-3485

                           The applicable Agent will cause a stickered
                           supplemented Prospectus with the trade confirmation
                           to be delivered to the purchaser of the Note.

                           For record keeping purposes, one copy of each Pricing
                           Supplement shall also be mailed or telecopied to each
                           Agent and the Trustee at the following respective
                           addresses:

                           To UBS Securities LLC:
                           UBS Securities LLC
                           677 Washington Boulevard
                           Stamford, Connecticut 06901
                           Attention: Fixed Income Syndicate
                           Telephone: (203) 719-1088
                           Telecopy:  (203) 719-0495

                           To Banc of America Securities LLC:
                           Banc of America Securities LLC
                           9 West 57th Street
                           NY1-301-2M-01
                           New York, New York 10019
                           Attention:  High Grade Debt Capital Markets
                                       Transaction Management
                           Telecopy:   (212) 847-5184

                           To Keefe, Bruyette & Woods, Inc.:
                           Keefe, Bruyette & Woods, Inc.
                           787 Seventh Avenue
                           New York, New York  10019
                           Attention: Fixed Income Syndicate
                           Telecopy: (212) 582-5419


                                      -7-
<PAGE>



                           To Popular Securities, Inc.:
                           Popular Securities, Inc.
                           209 Munoz Rivera Avenue
                           Hato Rey, Puerto Rico  00918
                           Attention:  Ken McGrath
                           Telecopy:    (787) 766-3485

                           To the Trustee:
                           J.P. Morgan Trust Company, National Association
                           227 W. Monroe Street, Suite 2600
                           Chicago, IL  60606
                           Telephone:  (312) 267-5121
                           Telecopy:   (312) 267-5209

                           In each instance that a Pricing Supplement is
                           prepared, the applicable Agent will affix the Pricing
                           Supplement to supplemented Prospectuses prior to its
                           use. Outdated Pricing Supplements and the
                           Prospectuses to which they are attached (other than
                           those retained for files) will be destroyed.

Settlement:                The receipt of immediately available funds by the
                           Company in payment for a Note and the authentication
                           and delivery of such Note shall, with respect to such
                           Note, constitute "settlement." Offers accepted by the
                           Company will be settled at a time as the purchaser
                           and the Company shall agree and pursuant to the
                           timetable for settlement set forth in Parts II and
                           III hereof under "Settlement Procedures" with respect
                           to Book-Entry Notes and Certificated Notes,
                           respectively (each such date fixed for settlement, a
                           "Settlement Date"). If procedures A and B of the
                           applicable Settlement Procedures with respect to a
                           particular offer are not completed on or before the
                           time set forth under the applicable "Settlement
                           Procedures Timetable," such offer shall not be
                           settled until the Business Day following the
                           completion of Settlement Procedures A and B or such
                           later date as the purchaser and the Company shall
                           agree.

                           In the event of a purchase of Notes by an Agent as
                           principal, appropriate settlement details will be set
                           forth in the applicable Terms Agreement to be entered
                           into between the applicable Agent and the Company


                                      -8-
<PAGE>


                           pursuant to the Distribution Agreement.

Procedure for Changing
  Rates or Other
  Variable Terms:          When a decision has been reached to change the
                           interest rate or any other variable term on any Notes
                           being offered by the Company, the Company will
                           promptly advise the Agents and the Agents will
                           forthwith suspend solicitation of offers to purchase
                           such Notes. Each Agent will telephone the Company
                           with recommendations as to the changed interest rates
                           or other variable terms. At such time as the Company
                           advises the Agents of the new interest rates or other
                           variable terms, the Agents may resume solicitation of
                           offers to purchase such Notes. Until such time, only
                           "indications of interest" may be recorded.
                           Immediately after acceptance by the Company of an
                           offer to purchase at a new interest rate or new
                           variable term, the Company, the Agents and the
                           Trustee shall follow the procedures set forth under
                           the applicable "Settlement Procedures."

Suspension of
  Solicitation;
  Amendment or
  Supplement:              The Company may instruct the Agents to suspend
                           solicitation of purchases at any time. Upon receipt
                           of such instructions, the Agents will forthwith
                           suspend solicitation of offers to purchase from the
                           Company until such time as the Company has advised
                           them that solicitation of offers to purchase may be
                           resumed. If the Company decides to amend the
                           Registration Statement (including incorporating any
                           documents by reference therein) or supplement any of
                           such documents (other than to change rates or other
                           variable terms), it will promptly advise the Agents
                           and, except in the case of an amendment by the filing
                           of a document incorporated by reference in the
                           Registration Statement, will furnish each Agent and
                           its counsel with copies of the proposed amendment or
                           supplement. One copy of such filed document, along
                           with a copy of the cover letter sent to the
                           Commission, will be delivered or mailed to the Agents
                           at the following addresses:


                                      -9-
<PAGE>



                           To UBS Securities LLC:
                           UBS Securities LLC
                           677 Washington Boulevard
                           Stamford, Connecticut 06901
                           Attention: Fixed Income Syndicate
                           Telephone: (203) 719-1088
                           Telecopy: (203) 719-0495

                           To Banc of America Securities LLC:
                           Banc of America Securities LLC
                           9 West 57th Street
                           NY1-301-2M-01
                           New York, New York 10019
                           Attention:  High Grade Debt Capital Markets
                                       Transaction Management
                           Telecopy:   (212) 847-5184

                           To Keefe, Bruyette & Woods, Inc.:
                           Keefe, Bruyette & Woods, Inc.
                           787 Seventh Avenue
                           New York, New York 10019
                           Attention: Fixed Income Syndicate
                           Telecopy: (212) 582-5419

                           To Popular Securities, Inc.:
                           Popular Securities, Inc.
                           209 Munoz Rivera Avenue
                           Hato Rey, Puerto Rico  00918
                           Attention:    Ken McGrath
                           Telecopy:    (787) 766-3485

                           In the event that at the time the solicitation of
                           offers to purchase from the Company is suspended
                           (other than to change interest rates or other
                           variable terms) there shall be any offers to purchase
                           Notes that have been accepted by the Company which
                           have not been settled, the Company will promptly
                           advise the Agents and the Trustee whether such offers
                           may be settled and whether copies of the Prospectus
                           as theretofore amended and/or supplemented as in
                           effect at the time of the suspension may be delivered
                           in connection with the settlement of such orders. The
                           Company will have the sole responsibility for such
                           decision and for any arrangements which may be made
                           in the event that the Company determines that such
                           orders may not be settled or that


                                      -10-
<PAGE>



                           copies of such Prospectus may not be so delivered.

Delivery of Prospectus:    A copy of the most recent Prospectus and Pricing
                           Supplement must accompany or precede the earlier of
                           (a) the written confirmation of a sale sent to a
                           customer or his agent and (b) the delivery of Notes
                           to a customer or his agent.

Authenticity of
  Signatures:              The Agents will have no obligation or liability to
                           the Company or the Trustee in respect of the
                           authenticity of the signature of any officer,
                           employee or agent of the Company or the Trustee on
                           any Note or related Guarantee.

Documents Incorporated
  by Reference:            The Company shall supply each Agent with an adequate
                           supply of all documents incorporated by reference in
                           the Registration Statement.

Business Day:              "Business Day" has the meaning set forth in the
                           Prospectus Supplement.



                                      -11-
<PAGE>


                      PART II: PROCEDURES FOR NOTES ISSUED
                               IN BOOK-ENTRY FORM

         In connection with the qualification of Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, the Trustee will perform
the custodial, document control and administrative functions described below, in
accordance with its obligations under a Letter of Representations from the
Company and The First National Bank of Chicago to DTC, dated August 6, 1999, as
supplemented by a Bring-Down Letter of Representations from the Company and the
Trustee to DTC, dated June 30, 2004, and a Medium-Term Note Certificate
Agreement between The First National Bank of Chicago and DTC, dated May 26, 1989
(the "Certificate Agreement"), and its obligations as a participant in DTC,
including DTC's Same-Day Funds Settlement System ("SDFS").

Issuance:                  All Fixed Rate Book-Entry Notes having the same
                           Original Issue Date, interest rate, terms of
                           redemption or repayment, if any, and Stated Maturity
                           (collectively, the "Fixed Rate Terms") will be
                           represented initially by a single global security in
                           fully registered form without coupons; and all
                           Floating Rate Book-Entry Notes having the same
                           Original Issue Date, interest rate basis or bases
                           upon which interest may be determined (each, an
                           "Interest Rate Basis"), which may be one or more of
                           the Commercial Paper Rate, the Treasury Rate, LIBOR,
                           the CD Rate, the CMT Rate, the Federal Funds Rate,
                           the Prime Rate, the 11th District Rate, and any other
                           rate set forth by the Company, Initial Interest Rate,
                           Index Maturity, Spread and/or Spread Multiplier, if
                           any, Minimum Interest Rate, if any, Maximum Interest
                           Rate, if any, terms of redemption or repayment, if
                           any, and Stated Maturity (collectively, "Floating
                           Rate Terms") will be represented initially by a
                           single Book-Entry Note.

                           Each Book-Entry Note will be dated and issued as of
                           the date of its authentication by the Trustee or its
                           duly appointed authenticating agent. Each Book-Entry
                           Note will bear interest from a date (the "Interest
                           Accrual Date") which will be (a) with respect to an
                           original Book-Entry Note (or any portion thereof),
                           its Original Issue Date and (b) with respect to any
                           Book-Entry Note (or portion thereof) issued
                           subsequently upon exchange or transfer of a
                           Book-Entry Note or in lieu of a destroyed, lost or
                           stolen Book-Entry Note, the most recent Interest


                                      -12-
<PAGE>

                           Payment Date to which interest has been paid or duly
                           provided for on the predecessor Book-Entry Note or
                           Notes or if no such payment or provision has been
                           made, the Original Issue Date of the predecessor
                           Book-Entry Note or Notes, regardless of the date of
                           authentication of such subsequently issued Book-Entry
                           Note. No Book-Entry Note shall represent any
                           Certificated Note.

Identification:            The Agents have arranged with the CUSIP Service
                           Bureau (the "CUSIP Service Bureau") of Standard &
                           Poor's Ratings Service, a division of the McGraw-Hill
                           Companies ("S&P"), for the reservation of
                           approximately 900 CUSIP numbers for each rank of
                           Notes which have been reserved for future assignment
                           to Book-Entry Notes representing Notes issued in
                           book-entry form and have delivered to the Company,
                           the Trustee and DTC an initial written list of such
                           CUSIP numbers. The Trustee will assign CUSIP numbers
                           to Book-Entry Notes as described below under
                           Settlement Procedure B. DTC will notify the CUSIP
                           Service Bureau periodically of the CUSIP numbers that
                           the Trustee has assigned to Book-Entry Notes. The
                           Trustee will notify the Company at any time when
                           fewer than 100 of the respective reserved CUSIP
                           numbers remain unassigned to Book-Entry Notes, and,
                           if it deems necessary, the Company will reserve
                           additional CUSIP numbers for assignment to Book-Entry
                           Notes representing Notes issued in book-entry form.
                           Upon obtaining such additional CUSIP numbers, the
                           Company will deliver a list of such additional
                           numbers to the Trustee and DTC. Book-Entry Notes
                           having an aggregate principal amount in excess of
                           $500,000,000 and otherwise required to be represented
                           by the same Global Certificate will instead be
                           represented by two or more Global Certificates which
                           shall be assigned the same CUSIP number.


                                      -13-
<PAGE>

Registration:              Each Book-Entry Note will be registered in the name
                           of CEDE & CO., as nominee for DTC, on the register
                           maintained by the Trustee under the Indenture. The
                           beneficial owner of a Book-Entry Note (i.e., an owner
                           of a beneficial interest in a Book-Entry Note), or
                           one or more indirect participants in DTC designated
                           by such owner, will designate one or more
                           participants in DTC (with respect to such Book-Entry
                           Note, the "Participants") to act as agent for such
                           beneficial owner in connection with the book-entry
                           system maintained by DTC, and DTC will record in
                           book-entry form, in accordance with instructions
                           provided by such Participants, a credit balance with
                           respect to such Book-Entry Note in the account of
                           such Participants. The ownership interest of such
                           beneficial owner in such Book-Entry Note will be
                           recorded through the records of such Participants or
                           through the separate records of such Participants and
                           one or more indirect participants in DTC.

Transfers:                 Transfers of beneficial interests in a Book-Entry
                           Note will be accomplished by book entries made by DTC
                           and, in turn, by Participants (and in certain cases,
                           one or more indirect participants in DTC) acting on
                           behalf of beneficial transferors and transferees of
                           such Book-Entry Note.

Exchanges:                 The Trustee may deliver to DTC and the CUSIP Service
                           Bureau at any time a written notice specifying (a)
                           the CUSIP numbers of two or more Book-Entry Notes
                           Outstanding on such date that represent Book-Entry
                           Notes having the same Fixed Rate Terms or Floating
                           Rate Terms, as the case may be, other than Original
                           Issue Dates, and for which interest has been paid to
                           the same date; (b) a date, occurring at least 30 days
                           after such written notice is delivered and at least
                           30 days before the next Interest Payment Date for the
                           related Book-Entry Notes, on which such Book-Entry
                           Notes shall be exchanged for a single replacement
                           Book-Entry Note; and (c) a new CUSIP number to be
                           assigned to such replacement Book-Entry Note. Upon
                           receipt of such a notice, DTC will send to its
                           Participants (including the Trustee) a written

                                      -14-
<PAGE>



                           reorganization notice to the effect that such
                           exchange will occur on such date. Prior to the
                           specified exchange date, the Trustee will deliver to
                           the CUSIP Service Bureau written notice setting forth
                           such exchange date and the new CUSIP number and
                           stating that, as of such exchange date, the CUSIP
                           numbers of the Book-Entry Notes to be exchanged will
                           no longer be valid. On the specified exchange date,
                           the Trustee will exchange such Book-Entry Notes for a
                           single Book-Entry Note bearing the new CUSIP number
                           and the CUSIP numbers of the exchanged Book-Entry
                           Notes will, in accordance with CUSIP Service Bureau
                           procedures, be cancelled and not immediately
                           reassigned. Notwithstanding the foregoing, if the
                           Book-Entry Notes to be exchanged exceed $500,000,000
                           in aggregate principal amount, one replacement
                           Book-Entry Note will be authenticated and issued to
                           represent each $500,000,000 of principal amount of
                           the exchanged Book-Entry Notes and an additional
                           Book-Entry Note will be authenticated and issued to
                           represent any remaining principal amount of such
                           Book-Entry Notes (see "Denominations" below).

Denominations:             All Book-Entry Notes will be denominated in U.S.
                           dollars and will be issued in denominations of a
                           minimum of $1,000 and integral multiples of $1,000.
                           Book-Entry Notes will be denominated in principal
                           amounts not in excess of $500,000,000. If one or more
                           Book-Entry Notes having an aggregate principal amount
                           in excess of $500,000,000 would, but for the
                           preceding sentence, be represented by a single
                           Book-Entry Note, then one Book-Entry Note will be
                           issued to represent each $500,000,000 principal
                           amount of such Note or Notes issued in book-entry
                           form and an additional Book-Entry Note will be issued
                           to represent any remaining principal amount of such
                           Note or Notes issued in book-entry form. In such a
                           case, each of the Book-Entry Notes shall be assigned
                           the same CUSIP number.


                                      -15-
<PAGE>

Interest:                  General. Interest on each Note issued in book-entry
                           form will accrue from the Interest Accrual Date of
                           the Book-Entry Note representing such Note. Each
                           payment of interest on a Book-Entry Note will include
                           interest accrued through the day preceding, as the
                           case may be, the Interest Payment Date, Stated
                           Maturity Date, Redemption Date or Repayment Date.
                           Interest payable at Maturity of a Book-Entry Note
                           will be payable to the Person to whom the principal
                           of such Note is payable. DTC will arrange for each
                           pending deposit message described under Settlement
                           Procedure C below to be transmitted to S&P, which
                           will use the information in the message to include
                           certain terms of the related Book-Entry Note in the
                           appropriate daily bond report published by S&P.

                           Interest Payment Dates. Interest payments will be
                           made on each Interest Payment Date commencing with
                           the first Interest Payment Date following the
                           Original Issue Date; provided, however, the first
                           payment of interest on any Book-Entry Note
                           originally issued between a Regular Record Date and
                           an Interest Payment Date will occur on the Interest
                           Payment Date following the next Regular Record Date.

                           Fixed Rate Notes. Unless otherwise specified in the
                           applicable Pricing Supplement, interest payments on
                           Fixed Rate Book-Entry Notes will be made
                           semiannually on June 15 and December 15 of each
                           year and at Maturity.

                           Floating Rate Notes. Except as provided in Part I
                           under "Calculation of Interest" and unless
                           otherwise specified in the applicable Pricing
                           Supplement, the Interest Payment Date for a Floating
                           Rate Note will be, in the case of Floating Rate
                           Notes which reset daily, weekly or monthly, on the
                           third Wednesday of each month or on the third
                           Wednesday of March, June, September and December of
                           each year as specified in the applicable Pricing
                           Supplement; in the case of Floating Rate Notes
                           which reset quarterly, on the third Wednesday of
                           March, June, September and December of each year;
                           in the case

                                      -16-
<PAGE>


                           of Floating Rate Notes which reset semiannually, on
                           the third Wednesday of the two months of each year
                           specified in the applicable Pricing Supplement; and
                           in the case of Floating Rate Notes which reset
                           annually, on the third Wednesday of the month
                           specified in the applicable Pricing Supplement; and,
                           in each case, at Maturity. For additional special
                           provisions relating to Floating Rate Notes, see the
                           Prospectus Supplement.

                           Regular Record Dates. Unless otherwise specified in
                           the applicable Pricing Supplement, the Regular Record
                           Date with respect to any Interest Payment Date for a
                           Fixed Rate Note shall be the June 1 or December 1
                           (whether or not a Business Day) preceding such
                           Interest Payment Date. Unless otherwise specified in
                           the applicable Pricing Supplement, the Regular Record
                           Date with respect to any Interest Payment Date for
                           any Floating Rate Note shall be the date 15 calendar
                           days (whether or not a Business Day) preceding such
                           Interest Payment Date.

                           Notice of Interest Payments and Regular Record Dates.
                           On the first Business Day of January, April, July and
                           October of each year, the Trustee will deliver to the
                           Company and DTC a written list of Regular Record
                           Dates and Interest Payment Dates that will occur
                           during the six-month period beginning on such first
                           Business Day with respect to Floating Rate Book-Entry
                           Notes. Promptly after each Interest Determination
                           Date for Floating Rate Book-Entry Notes, the Company
                           will notify S&P of the interest rates determined on
                           such Interest Determination Date.

Payments of Principal
  and Interest:            Payments of Interest Only. Promptly after each
                           Regular Record Date, the Trustee will deliver to the
                           Company and DTC a written notice specifying by CUSIP
                           number the amount of interest to be paid on each
                           Book-Entry Note issued under the Indenture on the
                           following Interest Payment Date (other than an
                           Interest Payment Date coinciding with Maturity) and
                           the total of such amounts. DTC will confirm


                                      -17-
<PAGE>


                           the amount payable on each Book-Entry Note on such
                           Interest Payment Date by reference to the daily bond
                           reports published by Standard & Poor's. On such
                           Interest Payment Date, the Company will pay to the
                           Trustee, and the Trustee in turn will pay to DTC,
                           such total amount of interest due (other than at
                           Maturity), at the times and in the manner set forth
                           below under "Manner of Payment."

                           Payments at Maturity. On or about the first Business
                           Day of each month, the Trustee will deliver to the
                           Company and DTC a written list of principal, interest
                           and premium, if any, to be paid on each Book-Entry
                           Note issued under the Indenture having a Maturity in
                           the following month. The Trustee and DTC will confirm
                           the amounts of such principal, premium and interest
                           payments with respect to a Book-Entry Note on or
                           about the fifth Business Day preceding the Maturity
                           of such Book-Entry Note. At such maturity, the
                           Company will pay to the Trustee, and the Trustee in
                           turn will pay to DTC, the principal amount of such
                           Note, together with interest and premium, if any, due
                           at such Maturity, at the times and in the manner set
                           forth below under "Manner of Payment." Promptly after
                           payment to DTC of the principal, interest and
                           premium, if any, due at the Maturity of such
                           Book-Entry Note, the Trustee will cancel and destroy
                           such Book-Entry Note and deliver to the Company a
                           certificate of destruction therefor.

                           Manner of Payment. The total amount of any principal,
                           premium, if any, and interest due on Book-Entry Notes
                           on any Interest Payment Date or at Maturity shall be
                           paid by the Company to the Trustee in funds available
                           for use as of 9:30 a.m., New York City time, on such
                           date. The Company will make such payment on such
                           Book-Entry Notes by instructing the Trustee to
                           withdraw funds from an account maintained by the
                           Company with the Trustee. The Company will confirm
                           such instructions in writing to the Trustee. Prior to
                           10:00 a.m., New York City time, on such date or as
                           soon as possible thereafter, the Trustee will pay by
                           separate wire transfer (using Fedwire message entry
                           instruc-


                                      -18-
<PAGE>


                           tions in a form previously specified by DTC) to an
                           account at the Federal Reserve Bank of New York
                           previously specified by DTC, in funds available for
                           immediate use by DTC, each payment of principal,
                           premium, if any, and interest due on a Book-Entry
                           Note on such date. Thereafter on such payment date,
                           DTC will pay, in accordance with its SDFS operating
                           procedures then in effect, such amounts in funds
                           available for immediate use to the respective
                           Participants in whose names such Notes are recorded
                           in the book-entry system maintained by DTC. Neither
                           the Company nor the Trustee shall have any
                           responsibility or liability for the payment by DTC of
                           the principal, premium, if any, or interest due on
                           the Book-Entry Notes to such Participants.

                           Withholding Taxes. The amount of any taxes required
                           under applicable law to be withheld from any interest
                           payment on a Note will be determined and withheld by
                           the Participant, indirect participant in DTC or other
                           Person responsible for forwarding payments and
                           materials directly to the beneficial owner of such
                           Note.

Settlement Procedures:     Settlement Procedures with regard to each Book-Entry
                           Note sold by the Agents, as agents of the Company,
                           will be as follows:

                           A.       The applicable Agent will advise the Company
                                    by telephone of the following Settlement
                                    information:

                                    1.       Taxpayer identification number of
                                             the purchaser.

                                    2.       Principal amount of the Note.

                                    3.       Fixed Rate Notes:

                                             (a)     interest rate;

                                             (b)     Regular Record Dates; and

                                             (c)     Interest Payment Dates.

                                             Floating Rate Notes:



                                      -19-
<PAGE>

                                             (a)     interest rate basis;

                                             (b)     index maturity;

                                             (c)     spread and/or spread
                                                     multiplier, if any;

                                             (d)     initial interest rate;

                                             (e)     maximum interest rate, if
                                                     any;

                                             (f)     minimum interest rate, if
                                                     any;

                                             (g)     interest reset dates;

                                             (h)     interest determination
                                                     dates;

                                             (i)     interest payment dates; and

                                             (j)     calculation agent.

                                    4.       Price to public of the Note.

                                    5.       Trade date.

                                    6.       Settlement Date (Original Issue
                                             Date).

                                    7.       Stated Maturity.

                                    8.       Redemption provisions, if any:

                                             (a)     Redemption Commencement
                                                     Date

                                             (b)     initial redemption
                                                     percentage

                                             (c)     annual redemption
                                                     percentage reduction

                                    9.       Repayment Date(s), if any.

                                    10.      Net proceeds to the Company.

                                    11.      Agent's commission.

                           B.       The Company will advise the Trustee by
                                    telecopy or other method acceptable to the
                                    Trustee of the above settlement information
                                    received with respect to each Note from the
                                    applicable Agent and shall confirm to the
                                    Trustee that the principal amount of Notes,
                                    including such Note, issued as of the
                                    relevant Settlement Date shall not exceed
                                    the limit with respect to the principal
                                    amount of Notes specified in the most recent
                                    Company Order delivered to the Trustee
                                    pursuant to Section


                                      -20-
<PAGE>

                                    303 of the Indenture.

                           C.       The Trustee will assign a CUSIP Number to
                                    the Book-Entry Note and will telephone and
                                    advise the Company and the applicable Agent
                                    of such CUSIP Number. The Trustee will
                                    communicate to DTC and the applicable Agent
                                    through DTC's Participant Terminal System a
                                    pending deposit message specifying the
                                    following settlement information:

                                    1.       The information set forth in
                                             Settlement Procedure A.

                                    2.       Identification numbers of the
                                             participant accounts maintained by
                                             DTC on behalf of the Trustee and
                                             the applicable Agent.

                                    3.       Identification as a Fixed Rate
                                             Book-Entry Note or Floating Rate
                                             Book-Entry Note.

                                    4.       Initial Interest Payment Date for
                                             such Note, number of days by which
                                             such date succeeds the related
                                             record date for DTC purposes (which
                                             in the case of Floating Rate Notes
                                             that reset daily or weekly will be
                                             the date five calendar days
                                             immediately preceding the
                                             applicable Interest Payment Date
                                             and in the case of all other
                                             Book-Entry Notes will be the
                                             Regular Record Date, as defined in
                                             the Notes) and, if then calculable,
                                             the amount of interest payment
                                             on such Interest Payment Date
                                             (which amount shall have been
                                             confirmed by the Trustee).

                                    5.       CUSIP number of the Book-Entry Note
                                             representing such Note.

                                    6.       Whether such Book-Entry Note
                                             represents any other Notes issued
                                             or to be issued in book-entry form.

                           D.       The Company will deliver to the Trustee a
                                    Book-Entry Note representing such Note in a
                                    form that has been approved by the Company,
                                    the applicable Agent and the Trustee.


                                      -21-
<PAGE>



                           E.       The Trustee will complete and authenticate
                                    the Book-Entry Note.

                           F.       DTC will credit such Note to the participant
                                    account of the Trustee maintained by DTC.

                           G.       The Trustee will enter an SDFS deliver order
                                    through DTC's Participant Terminal System
                                    instructing DTC (i) to debit such Note to
                                    the Trustee's participant account and credit
                                    such Note to the participant account of the
                                    applicable Agent maintained by DTC and (ii)
                                    to debit the settlement account of the
                                    applicable Agent and credit the settlement
                                    account of the Trustee maintained by DTC, in
                                    an amount equal to the price of such Note
                                    less the applicable Agent's commission. Any
                                    entry of such a deliver order shall be
                                    deemed to constitute a representation and
                                    warranty by the Trustee to DTC that (i) the
                                    Book-Entry Note has been issued and
                                    authenticated and (ii) the Trustee is
                                    holding such Book-Entry Note pursuant to the
                                    Certificate Agreement between the Trustee
                                    and DTC.

                           H.       The applicable Agent will enter an SDFS
                                    deliver order through DTC's Participant
                                    Terminal System instructing DTC (i) to debit
                                    such Note to the applicable Agent's
                                    participant account and credit such Note to
                                    the participant accounts of the appropriate
                                    Participants maintained by DTC and (ii) to
                                    debit the settlement accounts of such
                                    Participants and credit the settlement
                                    account of the applicable Agent maintained
                                    by DTC, in an amount equal to the initial
                                    public offering price of such Note.

                           I.       Transfers of funds in accordance with SDFS
                                    deliver orders described in Settlement
                                    Procedures G and H will be settled in
                                    accordance with SDFS operating procedures in
                                    effect on the Settlement Date.

                           J.       The Trustee will credit to an account of the
                                    Company maintained by the Trustee funds


                                      -22-
<PAGE>





                                    available for immediate use in the amount
                                    transferred to the Trustee in accordance
                                    with Settlement Procedure G.

                           K.       The Trustee will send a copy of the
                                    Book-Entry Note stamped "SPECIMEN" on each
                                    page to the Company together with a
                                    statement setting forth the principal amount
                                    of Notes Outstanding as of the related
                                    Settlement Date after giving effect to such
                                    transaction and all other offers to purchase
                                    Notes of which the Company has advised the
                                    Trustee but which have not been settled.

                           L.       The applicable Agent will confirm the
                                    purchase of such Note to the purchaser
                                    either by transmitting to the Participant
                                    with respect to such Note a confirmation
                                    order through DTC's Participant Terminal
                                    System or by mailing a written confirmation
                                    to such purchaser.

Settlement Procedures
 Timetable:                For offers to purchase Notes accepted by the Company,
                           Settlement Procedures "A" through "L" set forth above
                           shall be completed as soon as possible but not later
                           than the respective times (New York City time) set
                           forth below:

                           Settlement
                           Procedure         Time
                           ----------        ----
                              A              11:00 a.m. on the trade date
                              B              12:00 noon on the trade date
                              C              2:00 p.m. on the trade date
                              D              3:00 p.m. on the Business Day
                                             before Settlement Date
                              E              9:00 a.m. on Settlement Date
                              F              10:00 a.m. on Settlement Date
                              G-H            No later than 2:00 p.m. on
                                             Settlement Date
                              I              4:45 p.m. on Settlement Date
                              J-L            5:00 p.m. on Settlement Date

                           If a sale is to be settled more than one Business Day


                                      -23-
<PAGE>

                           after the trade date, Settlement Procedures A, B, and
                           C may, if necessary, be completed at any time prior
                           to the specified times on the first Business Day
                           after such trade date. In connection with a sale
                           which is to be settled more than one Business Day
                           after the trade date, if the initial interest rate
                           for a Floating Rate Note is not known at the time
                           that Settlement Procedure A is completed, Settlement
                           Procedures B and C shall be completed as soon as such
                           rate has been determined, but no later than 11:00
                           a.m. and 2:00 p.m., New York City time, respectively,
                           on the second Business Day before the Settlement
                           Date. Settlement Procedure I is subject to extension
                           in accordance with any extension of Fedwire closing
                           deadlines and in the other events specified in the
                           SDFS operating procedures in effect on the Settlement
                           Date.

                           If settlement of a Book-Entry Note is rescheduled or
                           cancelled, the Company shall notify the Trustee and
                           the Trustee will deliver to DTC, through DTC's
                           Participant Terminal System, a cancellation message
                           to such effect by no later than 2:00 p.m., New York
                           City time, on the Business Day immediately preceding
                           the scheduled Settlement Date.

Failure to Settle:         If the Trustee has not entered an SDFS deliver order
                           with respect to a Book-Entry Note pursuant to
                           Settlement Procedure G, then upon written request
                           (which may be evidenced by facsimile transmission) of
                           the Company, the Trustee shall deliver to DTC,
                           through DTC's Participant Terminal System, as soon as
                           practicable a withdrawal message instructing DTC to
                           debit such Note to the participant account of the
                           Trustee maintained at DTC. DTC will process the
                           withdrawal message, provided that such participant
                           account contains a principal amount of the Book-Entry
                           Note representing such Note that is at least equal to
                           the principal amount to be debited. If withdrawal
                           messages are processed with respect to all the Notes
                           represented by a Book-Entry Note, the Trustee will
                           mark such Book-Entry Note "cancelled," make
                           appropriate entries in its records and send such


                                      -24-
<PAGE>


                           cancelled Book-Entry Note to the Company. The CUSIP
                           number assigned to such Book-Entry Note shall, in
                           accordance with CUSIP Service Bureau procedures, be
                           cancelled and not immediately reassigned. If
                           withdrawal messages are processed with respect to a
                           portion of the Notes represented by a Book-Entry
                           Note, the Trustee will exchange such Book-Entry Note
                           for two Book-Entry Notes, one of which shall
                           represent the Book-Entry Notes for which withdrawal
                           messages are processed and shall be cancelled
                           immediately after issuance, and the other of which
                           shall represent the other Notes previously
                           represented by the surrendered Book-Entry Note and
                           shall bear the CUSIP number of the surrendered
                           Book-Entry Note.

                           If the purchase price for any Book-Entry Note is not
                           timely paid to the Participants with respect to such
                           Note by the beneficial purchaser thereof (or a
                           person, including an indirect participant in DTC,
                           acting on behalf of such purchaser), such
                           Participants and, in turn, the applicable Agent may
                           enter SDFS deliver orders through DTC's Participant
                           Terminal System reversing Settlement Procedures G and
                           H, respectively. Thereafter, the Trustee will deliver
                           the withdrawal message and take the related actions
                           described in the preceding paragraph. If such failure
                           shall have occurred for any reason other than default
                           by the applicable Agent to perform its obligations
                           hereunder or under the Distribution Agreement, the
                           Company will reimburse the applicable Agent on an
                           equitable basis for its loss of the use of funds
                           during the period when the funds were credited to the
                           account of the Company.


                                      -25-
<PAGE>

                           Notwithstanding the foregoing, upon any failure to
                           settle with respect to a Book-Entry Note, DTC may
                           take any actions in accordance with its SDFS
                           operating procedures then in effect. In the event of
                           a failure to settle with respect to a Note that was
                           to have been represented by a Book-Entry Note also
                           representing other Notes, the Trustee will provide,
                           in accordance with Settlement Procedures D and E, for
                           the authentication and issuance of a Book-Entry Note
                           representing such remaining Notes and will make
                           appropriate entries in its records.

                      PART III: PROCEDURES FOR NOTES ISSUED
                              IN CERTIFICATED FORM

Denominations:             The Certificated Notes, other than Indexed Notes and
                           Multi-Currency Notes, will be issued in denominations
                           of a minimum of $1,000 and integral multiples of
                           $1,000. Indexed Notes or Multi-Currency Notes will be
                           issued in the denominations specified in the related
                           Multi-Currency or Indexed Note Prospectus Supplement
                           and Pricing Supplement.

Interest:                  Each Certificated Note will bear interest in
                           accordance with its terms. Interest will begin to
                           accrue on the Original Issue Date of a Certificated
                           Note for the first Interest Payment Period and on the
                           most recent Interest Payment Date to which interest
                           has been paid for all subsequent Interest Payment
                           Periods. Each payment of interest shall include
                           interest accrued to, but excluding, the date of such
                           payment. Unless otherwise specified in the applicable
                           Pricing Supplement, interest payments in respect of
                           Fixed Rate Certificated Notes will be made
                           semiannually on June 15 and December 15 of each year
                           and at Maturity. However, the first payment of
                           interest on any Certificated Note issued between a
                           Regular Record Date and an Interest Payment Date will
                           be made on the Interest Payment Date following the
                           next succeeding Regular Record Date. Unless otherwise
                           specified in the applicable Pricing Supplement, the
                           Regular Record Date with respect to any Interest
                           Payment Date for a Fixed


                                      -26-
<PAGE>

                           Rate Certificated Note shall be the June 1 or
                           December 1 (whether or not a Business Day) preceding
                           such Interest Payment Date. Interest at Maturity will
                           be payable to the person to whom the principal is
                           payable.

                           Except as provided in Part I under "Calculation of
                           Interest" and unless otherwise specified in the
                           applicable Pricing Supplement, the Interest Payment
                           Date for a Floating Rate Certificated Note will be,
                           in the case of Floating Rate Notes which reset daily,
                           weekly or monthly, on the third Wednesday of each
                           month or on the third Wednesday of March, June,
                           September and December of each year as specified in
                           the applicable Pricing Supplement; in the case of
                           Floating Rate Notes which reset quarterly, on the
                           third Wednesday of March, June, September and
                           December of each year; in the case of Floating Rate
                           Notes which reset semiannually, on the third
                           Wednesday of the two months of each year specified in
                           the applicable Pricing Supplement; and in the case of
                           Floating Rate Notes which reset annually, on the
                           third Wednesday of the month specified in the
                           applicable Pricing Supplement; and, in each case, at
                           Maturity. Unless otherwise specified in the
                           applicable Pricing Supplement, the Regular Record
                           Date with respect to a Floating Rate Note shall be
                           the date 15 calendar days (whether or not a Business
                           Day) preceding an Interest Payment Date.

Payments of Principal
  and Interest:            Upon presentment and delivery of the Certificated
                           Note, the Trustee or the Company's duly authorized
                           agent will pay the principal amount of each
                           Certificated Note at Maturity and the final
                           installment of interest in next day funds. All
                           interest payments in U.S. dollars on a Certificated
                           Note, other than interest due at Maturity, will be
                           made by check drawn on the Trustee or the Company's
                           duly authorized agent and mailed by such Trustee or
                           agent to the person entitled thereto as provided in
                           the Certificated Note. However, the Registered Owners
                           (as hereinafter defined) of ten


                                      -27-
<PAGE>


                           million dollars or more in aggregate principal amount
                           of the same series of Certificated Notes (whether
                           having identical or different terms and provisions)
                           shall be entitled to receive payments of interest,
                           other than at Maturity, by wire transfer of
                           immediately available funds if appropriate wire
                           transfer instructions have been received in writing
                           by the Trustee or such agent not less than 16 days
                           prior to the applicable Interest Payment Date.

                           For special provisions relating to Multi-Currency
                           Notes or Indexed Notes, see the related
                           Multi-Currency or Indexed Note Prospectus Supplement.

                           The Trustee will provide monthly to the Company a
                           list of the principal and interest in each currency
                           to be paid on Certificated Notes maturing in the next
                           succeeding month. Such Trustee or agent will be
                           responsible for withholding taxes on interest paid as
                           required by applicable law, but shall be relieved
                           from any such responsibility if it acts in good faith
                           and in reliance upon an opinion of counsel.

                           Certificated Notes presented to the Trustee or the
                           Company's duly authorized agent at Maturity for
                           payment will be cancelled by such Trustee or agent.
                           All cancelled Certificated Notes held by such Trustee
                           or agent shall be destroyed, and the Trustee or agent
                           shall furnish to the Company a certificate with
                           respect to such destruction.

 Settlement Procedures:    Settlement Procedures with regard to each
                           Certificated Note purchased through the Agents, as
                           agents, shall be as follows:

                           A.       Each Agent will advise the Company by
                                    telephone of the following Settlement
                                    information with regard to each Certificated
                                    Note:

                                    1.       Exact name in which the
                                             Certificated Note is to be
                                             registered (the "Registered
                                             Owner").

                                    2.       Exact address or addresses of the
                                             Registered Owner for delivery,
                                             notices


                                      -28-

<PAGE>

                                             and payments of principal, premium,
                                             if any, and interest.

                                    3.       Taxpayer identification number of
                                             the Registered Owner.

                                    4.       Principal amount of the
                                             Certificated Note.

                                    5.       Denomination of the Certificated
                                             Note.

                                    6.       Fixed Rate Notes:

                                             (a)     interest rate;

                                             (b)     Regular Record Dates; and

                                             (c)     Interest Payment Dates.

                                    Floating Rate Notes:

                                             (a)     interest rate basis or
                                                     bases;

                                             (b)     index maturity;

                                             (c)     spread or spread
                                                     multiplier, if any;

                                             (d)     initial interest rate;

                                             (e)     maximum interest rate, if
                                                     any;

                                             (f)     minimum interest rate, if
                                                     any;

                                             (g)     interest reset dates;

                                             (h)     interest determination
                                                     dates;

                                             (i)     interest payment dates; and

                                             (j)     calculation agent.

                                    Multi-Currency or Indexed Notes:

                                             (a)     specified currency;

                                             (b)     index, if any;

                                             (c)     base rate of exchange, if
                                                     any; and

                                             (d)     any other applicable terms.

                                    7.       Currency or currency unit in which
                                             the Certificated Note is to be
                                             denominated.

                                    8.       Price to public of the Certificated
                                             Note.

                                    9.       Settlement Date (Original Issue
                                             Date).

                                    10.      Stated Maturity.


                                      -29-
<PAGE>



                                    11.      Redemption provisions, if any:

                                             (a)     Redemption Commencement
                                                     Date

                                             (b)     initial redemption
                                                     percentage

                                             (c)     annual redemption
                                                     percentage reduction

                                    12.      Repayment Date(s), if any.

                                    13.      Net proceeds to the Company.

                                    14.      Agent's commission.

                           B.       The Company shall provide to the Trustee by
                                    telecopy or other method acceptable to the
                                    Trustee the above Settlement information
                                    with respect to each Certificated Note
                                    received from the Agents and the name of the
                                    applicable Agent and shall confirm to the
                                    Trustee that the principal amount of Notes,
                                    including such Certificated Note, issued as
                                    of the relevant Settlement Date shall not
                                    exceed the limit with respect to the
                                    principal amount of Notes specified in the
                                    most recent Company Order delivered to the
                                    Trustee pursuant to Section 303 of the
                                    Indenture. The Company also shall cause the
                                    Trustee or its duly appointed agent to
                                    issue, authenticate and deliver Certificated
                                    Notes in accordance with the Settlement
                                    Procedures Timetable set forth below. The
                                    Company also shall provide to the Trustee
                                    and the applicable Agent a copy of the
                                    applicable Pricing Supplement. The Company
                                    also shall provide to the Trustee and the
                                    applicable Agent a copy of a Multi-Currency
                                    or Indexed Note Prospectus Supplement, if
                                    applicable.

                           C.       The Trustee or its duly appointed agent will
                                    complete and authenticate the Certificated
                                    Note, including the Guarantee, in form
                                    approved by the Company.

                           D.       With respect to each trade, the Trustee will
                                    deliver the Certificated Note and one
                                    photocopy thereof stamped "SPECIMEN" on each
                                    page to the applicable Agent at the


                                      -30-
<PAGE>


                                    following addresses:

                           UBS Securities LLC
                           677 Washington Boulevard
                           Stamford, Connecticut 06901
                           Attention: Fixed Income Syndicate
                           Telephone: (203) 719-1088
                           Telecopy:   (203) 719-0495

                           Banc of America Securities LLC
                           9 West 57th Street
                           NY1-301-2M-01
                           New York, New York 10019
                           Attention:  High Grade Debt Capital Markets
                                       Transaction Management
                           Telecopy:    (212) 847-5184

                           Keefe, Bruyette & Woods, Inc.
                           787 Seventh Avenue
                           New York, New York  10019
                           Attention: Fixed Income Syndicate
                           Telecopy: (212) 582-5419

                           Popular Securities, Inc.
                           209 Munoz Rivera Avenue
                           Hato Rey, Puerto Rico  00918
                           Attention:  Ken McGrath
                           Telecopy:   (787) 766-3485

                           The Trustee will keep Stub 1. The applicable Agent
                           will acknowledge receipt of the Certificated Note
                           through a broker's receipt and will keep the
                           photocopy. Delivery of the Certificated Note will be
                           made only against such acknowledgment of receipt.

                           Upon determination that the Certificated Note,
                           including the related Guarantee, has been authorized,
                           delivered and completed as aforementioned, the
                           applicable Agent will wire the net proceeds of the
                           Certificated Note after deduction of its applicable
                           commission to the Company pursuant to standard wire
                           instructions given by the Company.


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                           E.       The applicable Agent will deliver the
                                    Certificated Note, the related Guarantee
                                    endorsed thereon, as well as a copy of the
                                    Prospectus and any applicable Pricing
                                    Supplement or Supplements received from the
                                    Trustee, to the purchaser against payment in
                                    immediately available funds.

                           F.       The Trustee will send a photocopy of the
                                    Certificated Note stamped "SPECIMEN" on each
                                    page to the Company.

Settlement Procedures
  Timetable:               For offers to purchase Certificated Notes accepted by
                           the Company, Settlement Procedures "A" through "F"
                           set forth above shall be completed on or before the
                           respective times set forth below:

                           Settlement
                           Procedure         Time
                           ----------        ----
                              A-B            3:00 PM on Business Day prior to
                                             Settlement
                              C-D            2:15 PM on Settlement Date
                              E              3:00 PM on Settlement Date
                              F              5:00 PM on Settlement Date

Failure to Settle:         In the event that a purchaser of a Certificated Note
                           from the Company shall either fail to accept delivery
                           of or make payment for a Certificated Note on the
                           date fixed for settlement, the applicable Agent will
                           forthwith notify the Trustee and the Company by
                           telephone, confirmed in writing, and return the
                           Certificated Note to the Trustee.

                           The Trustee or the Company's duly authorized agent,
                           upon receipt of the Certificated Note from the
                           applicable Agent, will immediately advise the
                           Company, and the Company will promptly arrange to
                           credit the account of the applicable Agent in an
                           amount of immediately available funds equal to the
                           amount previously paid by the applicable Agent in
                           settlement for the Certificated Note. Such credits
                           will be made on the Settlement Date if possible, and
                           in any event not later than the Business Day follow-


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